Fuso Pharmaceutical Industries,Ltd. (4538) AI Stock Analysis

• Market Cap: ¥22.09B
• Dividend Yield: 3.71%
• Average Volume (3M): 17.49K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.64
• Revenue Growth: 7.50%
• EPS Growth: -281.41%
• Country: JP
• Employees: 1,370
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 99.84
• Shares Outstanding: 9,451,169
• 10 Day Avg. Volume: 18,340
• 30 Day Avg. Volume: 17,486
• PEG Ratio: 0.07
• Price to Book (P/B): 0.53
• Price to Sales (P/S): 0.34
• P/FCF Ratio: -3.84
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 60 Neutral
• Price Target: ¥2,644.00 ▲(14.21% Upside)
• Action: Reiterated Date: 10/29/25
• Date: Action: Reiterated 10/29/25

Fuso Pharmaceutical Industries' overall stock score is driven by solid financial performance in terms of revenue growth and profitability, but is hampered by significant cash flow challenges. Technical indicators suggest neutral momentum, while valuation is mixed with a negative P/E ratio but a strong dividend yield.

Positive Factors

Prudent balance sheet

A conservative capital structure with a debt-to-equity of 0.54 and roughly 49% equity ratio supports resilience through industry cycles. Healthy ROE indicates the company generates acceptable returns on equity, preserving strategic optionality for R&D, capex, and dividends over the medium term.

Consistent revenue growth and improving margins

Sustained revenue growth paired with a 27.3% gross margin and improving net margin signals structural demand and controlled cost of goods sold. This mix supports ongoing profitability and provides a foundation for reinvestment into products and manufacturing capacity over multiple quarters.

Hospital-focused product and manufacturing capability

A focus on hospital-use pharmaceuticals and in-house manufacturing creates durable demand from institutional customers and tighter control of supply quality. This vertical integration reduces reliance on third-party supply and supports long-term contract relationships with hospitals and clinics.

Negative Factors

Negative free cash flow

Material negative free cash flow undermines the company's ability to self-fund operations, capex, and R&D without drawing on liquidity or raising capital. Persisting cash burn can pressure dividend sustainability, limit strategic investments, and increase reliance on external financing over months.

Earnings volatility / sharply negative EPS growth

Severely negative EPS growth indicates earnings instability and recent earnings shocks. This volatility reduces predictability of future operating cash flow and makes long-term planning, budgeting for product development, and maintaining consistent returns to shareholders more challenging.

Moderate operating margins and rising debt attention

Relatively modest EBIT/EBITDA margins limit free cash generation capacity and leave less buffer for reinvestment. Coupled with a noted uptick in total debt, this constrains financial flexibility and heightens the impact of any sustained revenue pressure on balance sheet strength over the medium term.

Fuso Pharmaceutical Industries,Ltd. Business Overview & Revenue Model

Company Description

Fuso Pharmaceutical Industries,Ltd. manufactures and sells pharmaceutical products in Japan. The company offers ethical drugs, such as injectables and artificial kidney dialysates; and medical machinery and equipment. It also rents real estate properties. The company was founded in 1937 and is headquartered in Osaka, Japan.

How the Company Makes Money

Fuso Pharmaceutical Industries generates revenue through multiple streams, primarily from the sale of its pharmaceutical products, including prescription medications and generics. The company has established partnerships with healthcare providers and distributors, allowing for an extensive market reach. Additionally, Fuso engages in research and development (R&D) collaborations with other pharmaceutical firms and institutions, which can lead to financial gains through licensing agreements and joint ventures. The company's ability to innovate and bring new drugs to market, coupled with its focus on high-demand therapeutic areas, significantly contributes to its revenue generation.

Fuso Pharmaceutical Industries,Ltd. Financial Statement Overview

Summary

Fuso Pharmaceutical Industries shows solid revenue growth and stable profitability margins. However, it faces significant challenges in cash flow management, with negative free cash flow and cash generation issues. The balance sheet remains robust with manageable debt levels.

Income Statement

Fuso Pharmaceutical Industries has shown consistent revenue growth, with a 9.31% increase from 2024 to 2025. The gross profit margin for 2025 stands at 27.3%, indicating efficient cost management. The net profit margin improved to 4.59%, reflecting enhanced profitability. However, the EBIT and EBITDA margins, while improved, are moderate at 6.82% and 10.39% respectively, suggesting room for operational efficiency improvements.

Balance Sheet

The balance sheet is stable with a debt-to-equity ratio of 0.54, reflecting prudent leverage levels. The return on equity is 7.11%, showing satisfactory returns on shareholders' investments. Equity ratio is healthy at 49.48%, indicating a strong equity base relative to total assets. However, the slight increase in total debt warrants attention for future leverage control.

Cash Flow

The cash flow statement shows challenges, with a negative free cash flow of -5.43 billion yen in 2025, marking a significant decline. The operating cash flow to net income ratio is negative, highlighting cash generation issues. The free cash flow to net income ratio is also negative, underscoring the need for improved cash management practices.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	15.50B	60.56B	55.41B	51.02B	49.63B	49.25B
Gross Profit	4.08B	16.53B	13.52B	13.74B	13.40B	14.11B
EBITDA	1.36B	6.29B	4.20B	4.63B	4.47B	4.79B
Net Income	462.00M	2.78B	1.38B	1.60B	1.48B	1.61B
Balance Sheet
Total Assets	86.99B	79.05B	75.80B	72.47B	69.33B	69.88B
Cash, Cash Equivalents and Short-Term Investments	3.16B	6.26B	5.12B	8.01B	7.35B	7.07B
Total Debt	28.23B	21.29B	12.72B	12.63B	12.09B	13.20B
Total Liabilities	53.81B	39.94B	39.14B	36.82B	34.80B	36.19B
Stockholders Equity	33.18B	39.11B	36.66B	35.65B	34.53B	33.68B
Cash Flow
Free Cash Flow	0.00	-5.43B	-2.96B	1.28B	2.01B	2.02B
Operating Cash Flow	0.00	-3.31B	627.00M	2.85B	3.50B	3.23B
Investing Cash Flow	0.00	-3.17B	-3.54B	-1.37B	-1.55B	-978.00M
Financing Cash Flow	0.00	7.62B	14.00M	-813.00M	-1.67B	-2.45B

Fuso Pharmaceutical Industries,Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2315.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4538, the sentiment is Positive. The current price of 2315 is below the 20-day moving average (MA) of 2377.90, below the 50-day MA of 2353.28, and above the 200-day MA of 2193.91, indicating a bullish trend. The MACD of 35.20 indicates Negative momentum. The RSI at 74.44 is Negative, neither overbought nor oversold. The STOCH value of 88.94 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4538.

Fuso Pharmaceutical Industries,Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4574	66 Neutral	¥15.83B	17.20	―	―	-5.41%	―
4524	65 Neutral	¥9.59B	17.19	―	2.55%	3.23%	42.87%
4539	64 Neutral	¥6.42B	11.77	―	3.21%	4.25%	―
4538	60 Neutral	¥22.09B	-5.37	―	3.71%	7.50%	-281.41%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
4512	48 Neutral	¥11.59B	38.82	―	1.06%	5.42%	-62.03%
2929	47 Neutral	¥18.69B	-9.94	―	3.65%	9.53%	-155.76%

Fuso Pharmaceutical Industries,Ltd. Corporate Events

Fuso Pharmaceutical Profit Slumps Despite Modest Sales Growth

Fuso Pharmaceutical Industries reported non-consolidated net sales of ¥48.27 billion for the nine months ended December 31, 2025, up 3.4% year on year, but operating profit dropped 34.8% to ¥2.37 billion and ordinary profit fell 33.7%, with profit declining almost 30%, reflecting margin pressure despite modest revenue growth. The company’s total assets rose to ¥89.45 billion while its equity ratio slipped to 38.7%, and it maintained its dividend policy with a planned annual payout of ¥90 per share for the fiscal year ending March 31, 2026, alongside a full-year forecast of only slight sales growth and lower profits, underscoring a more challenging earnings environment for shareholders.

The most recent analyst rating on (JP:4538) stock is a Hold with a Yen2469.00 price target. To see the full list of analyst forecasts on Fuso Pharmaceutical Industries,Ltd. stock, see the JP:4538 Stock Forecast page.

Fuso Pharmaceutical Sees Profit Slide Despite Higher Sales, Keeps Dividend Outlook Firm

Fuso Pharmaceutical Industries reported non-consolidated net sales of ¥48.27 billion for the nine months ended December 31, 2025, up 3.4% year on year, while operating profit fell 34.8% and profit dropped 29.9%, signaling margin pressure despite modest top-line growth. Total assets increased to ¥89.45 billion and net assets to ¥34.66 billion, but the equity ratio declined from 40.4% to 38.7%, indicating a slightly weaker capital structure.

The company maintained its dividend policy, having paid ¥82 per share in the prior fiscal year and forecasting a higher total dividend of ¥90 per share for the year ending March 31, 2026, underscoring continued shareholder returns. For the full year, Fuso projects modest 1.5% sales growth to ¥61.5 billion but expects double-digit declines in operating and ordinary profit, highlighting ongoing earnings headwinds even as it preserves stable payouts.

The most recent analyst rating on (JP:4538) stock is a Hold with a Yen2482.00 price target. To see the full list of analyst forecasts on Fuso Pharmaceutical Industries,Ltd. stock, see the JP:4538 Stock Forecast page.